Swim Wear Firm Joins Yuppie Set : Ocean Pacific Adds Menswear to Bolster Sagging Sales

Ocean Pacific Sunwear Ltd. is about to join the jacket-and-tie set.

With its sales and market share shrinking and its audience aging, the Tustin-based company that catapulted the California beachwear industry from obscurity to national prominence has invested more than $1 million in taking the lengthy leap from beachwear to California chic wear.

OP executives hope that the move upscale will spark new business and slowly edge its fashions away from the teen market and into the more lucrative men’s arena.

Industry analysts estimate that the multibillion-dollar menswear market is four times larger than OP’s present young men’s domain. OP executives project that the move will not only turn around slumping sales but increase OP’s annual revenue nearly fourfold to the $1-billion level by 1990--heady heights for a once-struggling swim wear company that posted sales of less than $50,000 in 1972, its first year of operation.

Just as Levi Strauss & Co., which has nearly $3 billion in annual sales, progressed from making jeans to producing men’s suits, OP is making the Yuppie-directed jump from manufacturing swimsuits and walking shorts to producing casual jackets and knit ties. For years, OP has appealed mostly to young men aged 16 to 24. Now, it is courting the 25-to-45 crowd.

Separate Operations

So serious is OP about this new direction that, under new leadership, the company has created a wholly owned subsidiary, with a separate name and separate operations, to oversee what some analysts see as one of the company’s most radical moves ever.

Company executives admit that more than slowing sales prompted the aggressive change in direction. They point to television shows such as “Miami Vice,” in which the stars’ fashions are as entertaining as the plot lines.

“These guys are not young men, they are men,” said Lawrence D. Ornitz, 50, who was named OP’s president and chief executive last December. “That’s who we’re after.”

The new focus is also the result of an attempt last year by Minneapolis-based Munsingwear Inc. to acquire privately owned OP. Munsingwear unexpectedly pulled out but left OP with a new-found enthusiasm for staying private.

Just four months later, the company named Ornitz chief executive and gave him a mission: to break into the large and lucrative main-floor menswear market.

OP has billed this new line of casual sportswear Newport Blue, a name that suggests the type of crowd that it is aimed at. The line will have its own insignia and its own sales staff. But it retains the crucial backing of a recreation wear company with $270 million in fiscal 1984 sales. OP’s projected 1985 sales are about $250 million, down from a last year’s record.

To lure the widest possible market, OP plans to keep price tags relatively low on its Newport Blue line. Knit shirts will cost about $25. Casual blazers will go for about $45, and cotton ties will sell for about $8.

Already, in a clear signal of the upscale market that OP hopes to draw with Newport Blue, the first two major orders for the apparel are from Macy’s New York and San Francisco stores.

“It’s a good move, but it won’t take the market by storm like their swim wear did,” said Howard Ruben, West Coast editor of the Daily News Record, a menswear trade publication.

However, he said that, because OP has so thoroughly saturated the market--it is even sold at Price Club and other deep-discount stores--use of a Newport Blue banner may be a big plus.

“Besides,” he said, “no teen-age kid wants to go out and buy the same thing that Dad is buying.”

When the Newport Blue line reaches department stores in February, the company expects a sales surge. In fact, first-year sales of the line could exceed $8 million, said Ornitz, a longtime OP associate who established OP’s European sales network shortly before his promotion.

The Newport Blue customer will be a far cry from the traditional buyer of OP clothes, Ornitz said.

“It’s the guy who likes to hear the surf but who might not be interested in getting out of his Porsche to stick his feet in the water,” he said.

Jerry G. Crosby, OP’s executive vice president of marketing, says that customers who are 30 years old plus have a “less literal” interpretation of beach life style than 20 year olds.

Started With Surfers

“The 35-year-old wants something to wear to a restaurant overlooking the beach while the 20-year-old prefers something for a party on the beach,” said Crosby, recently recruited from Max Factor, where he was senior vice president of marketing

John Bernards, founder of Offshore, a $20-million Santa Ana manufacturer of clothing for the surfing set, says OP is late with its upscale move, behind such companies as Jantzen.

“It’s a move they have to make. With so much competition, OP has lost a lot of volume. It seems that every guy with $2,000 and a design idea or two is in the business.”

That is essentially how OP got its start 13 years ago, when a couple of San Diego surfers, Chuck Buttner and Jim Jenks, designed some swim trunks that could withstand Southern California’s notoriously rough riptides. It didn’t take long before area surfers picked up on the fashion, and soon swarms of beachgoers were wearing them.

But so big and complex has OP grown that it now licenses all of its manufacturing worldwide. The company itself employs just 80 workers. Yet its beachwear is sold in more than 8,000 retail stores nationwide.

Late last year, both Buttner and Jenks accepted lesser corporate roles, and they now own less than 50% of the company, Ornitz said.

While the company is counting on Newport Blue for its long-term growth, it is continuing to dabble in other, lesser markets. It recently introduced a line of Swatch-like casual watches, is about to expand its year-old line of toddlers swim wear and will soon introduce lines of ski wear and tennis shoes.

If sales do turn up, the company may even consider opening its own retail stores, Ornitz said.

“The job is to try and keep growing,” he said. “It seems the apparel business has a forward and reverse gear but no neutral.”

OCEAN PACIFIC’S SALES In millions

1981: $64 ‘82: $144 ‘83: $220 ‘84: $270 ‘85: $250--Projected